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Recticel Results

Brexit evolution impacts Q3 sales at Belgian foam manufacturer

Recticel 0 bedding band

Belgium-based international polyurethane foam manufacturer Recticel SA has reported that adverse currency differences have impacted sales during its third quarter.

According to its latest trading update for Q3, combined group sales fell by 1.6% to €318.1m from €323.4m, which includes an adverse currency impact of -2.8%.

Combined year-to-date for the last nine months grew by 1.3% to €1,004.1m despite a currency impact of -1.9%.

Impacting Recticel’s progress was largely due to currency fluctuations following Brexit and lower selling prices as supply of isocyanates, which is used in the manufacture of foam and polyurethane, has been shortened over the last six months.

Recticel said that its Flexible Foams sector saw ‘resilient’ external sales at €129.1m in Q3, although combined sales for the quarter fell by 2.5% to €141.3m. Within its Bedding sector, total combined sales suffered a fall of 4.1% to €70.1m, as its sub-segment Non Branded/Private Label fell by 8.7%.

Looking ahead, the group said it expects combined sales to increase due to a combination of ‘volume growth and positive product-mix’, with combined REBITDA to ‘increase by at least 15%’ in 2016.

Olivier Chapelle, CEO, said: “During the third quarter volumes have remained strong in most business segments. Adverse currency exchange differences, mostly influenced by the GBP/EUR evolution, and slightly lower selling prices compared to Q3 2015, have more than offset the positive effect of strong volumes.

“The continued focus on operational performance and product-mix improvement, combined with initiatives to pass through raw material price increase and to compensate the Pound Sterling depreciation effect, allows the group to maintain profitability at expected level.”